North Korean Economy Watch

Pictured above (Google Earth): Hyesan City’s Kanggu-dong (강구동), Wiyon-dong (위연동), and Songpong-dong (송봉동) mentioned in the Daily NK story below.

According to Daily NK:

A source from Hyesan revealed the news yesterday, saying, “On the 11th, an NSA agent responsible for the Kanggu area of Hyesan committed suicide at his office. In one soldier’s testimony during the process of an investigation into the border guard unit, it came out that he had aided smuggling and defections, and had taken bribes. Out of fear of punishment, he killed himself.”

According to the source, there has recently been one other similar case in the city. In that instance, an NSA agent responsible for the Wuiyeon area killed himself at his house during April, apparently during an NSA investigation centering on the fact that an abnormally large number of defector families were there.

In another instance, NK Intellectuals Solidarity recently reported a case from February, where an NSA agent covering the Songbong area of the city killed himself at the time of his arrest by smashing his head into a wall. In that case, however, the NSA investigation was focused around the sale of 1kg of narcotics.

This is causing tension in the city, the source went on, explaining, “They are warning people not to gossip to others about issues related to the National Security Agency. The rumor now circulating is that there will be an in depth investigation by the central Party soon, so the feeling here is uneasy.”

In North Korea, a local NSA agent is responsible for roughly 1,000 households or less. Through roughly 40 or 50 people’s unit heads and Women’s Union cadres, the agent obtains information on the activities of local people and passes on instructions to them, thus playing a key role in the preservation of the system.

For smugglers and defectors, stepping outside this surveillance net is both important, and also hard. For that reason, smugglers commonly buy off NSA agents. Sources and defectors both agree that abetting defection is rarer, since it is punished more harshly, with whole extended families facing extreme consequences.

Ordinary city residents, meanwhile, are not sad to see the back of any agent who takes his own life, the source added, pointing out that they are one of the most hated groups in North Korea.

Hyesan is an ideal location from which to stage a defection.  Though it is the capital of Ryanggang Province (Yangang, 량강도) , it is both geographically and administratively remote—on the Chinese and DPRK sides of the border.  The border itself is a very shallow, sometimes dry, Yalu River basin which is lined in both directions with railway service.

Read the full story here:
Spate of NSA Agent Suicides in Hyesan
Daily NK
Lee Seok Young
2011-6-17

According to the Korea Herald (h/t L.P.):

A number of economic cooperation projects appear ready to take shape between North Korea and China.

A businessman here claimed the North and China have signed a more concrete agreement last year following up on a 2005 preliminary deal to jointly develop an offshore oil field.

“The North has agreed with China to jointly develop an offshore oil field in the waters off Nampo,” a western coastal town, said Kim Young-il, chief executive of a South Korean trading firm and inter-Korean trade adviser to the Korea International Trade Association.

“The North Korea-China agreement on joint development of the oil field seems to have taken place last year.”

It is estimated that some 20 billion tons of crude oil is buried under the Bohai Gulf continental shelf which stretches across the Korea Bay between the North Pyongan Province and China’s Liaoning Province, Kim said during a policy debate session hosted by a legislator.

“The joint exploration would be economically viable because, once about a third of the oil reserve can be extracted, they can extract between 7 and 8 billion tons, enough to meet China’s entire demand for nearly 30 years,” Kim said.

Read the full story here:
Communist allies seek strategic interests
Korea Herald
Kim So-hyun
2011-6-1

Pictured above (Google Earth): Kangso Mineral Water Processing Factory (Google Maps)

According to the Hankyoreh:

Former DD Trading Chairman Lee Dae-sik, 74, still has trouble sleeping when he thinks about the events of the past few years. In that time, he has had to shut down an effort in the North Korea that was earning 4 to 5 billion won ($3.7 million to $4.6 million) in annual sales just a few years ago, as a result of the Lee Myung-bak administration’s hardline policy against North Korea.

“At the time I was investing in North Korea, we had the Inter-Korean Exchange and Cooperation Act, and I never dreamed they would halt North Korea projects. Now the government will not let us do an effort it granted approval for, something we had been doing consistently. It is just…”

During an interview with the Hankyoreh at a cafe in the Hawolgok neighborhood of Seoul’s Seongbuk District on Tuesday evening, the day before the eleventh anniversary of the June 15 Joint Declaration, Lee was too overcome with emotion to finish his sentence. He is one of the many South Korean businesspeople who have suffered as a result of the government’s restrictions on trade with North Korea. According to a January-February survey of companies engaged in North Korea efforts, the 104 companies that responded sustained an average loss of 3.9 billion won ($3.6 million) as a result of the May 24 measures restricting inter-Korean trade.

Lee is a first-generation North Korea entrepreneur who has been engaged in trade with the country since the Kim Young-sam administration in 1994. Originally the operator of a shoe factory in Busan, Lee struggled with the competition of cheap labor in China and Northeast Asia and searched for a change before finally taking the leap into North Korea. At first, he imported Pyongyang soju and agricultural products like bracken, balloon flower roots, and pine mushrooms.

“After the June 15 summit in 2000, the North Koreans grew more flexible in their attitude and became easier to deal with,” he recalled.

Lee, who steadily expanded the range of his operations over the years, began an effort in 2005 with Pyongyang’s Kangso Yaksu. This mineral water, North Korean National Treasure No. 56, is naturally carbonated and contains minerals like calcium and iron. After securing exclusive sales rights from North Korean authorities, Lee completed construction on a production plant the next year at an investment of 3 billion won. According to the conditions of the contract, Lee sent the cost of the water and the raw materials for the bottles, along with caps and labels, and the North Koreans operates the factory and sent the water produced.

“We imported it to South Korea under the brand name of ‘Gangseo Cheongsan,’ and sales increased from an initial level of 100 thousand to 200 thousand bottles a month to 300 thousand to 400 thousand bottles a month,” he said.

But stormy clouds appeared on the horizon when the Lee Myung-bak administration took office in 2008. As inter-Korean relations grew chilly due to the shooting death of a South Korean tourist at Mt. Kumkang in July of that year and North Korea’s missile launch and nuclear test in April and May of 2009, respectively, the Lee administration placed restrictions on contact with North Korea by civilians.

“When you apply for contact with North Korea, the government tells you to ‘please refrain from doing so,’” Lee said. “They say ‘please refrain,’ but who is going to refuse a request from the government? They are basically telling you, ‘Don’t do it.’”

The decision left Lee unable to send the promised payment and bottle materials to North Korea and to receive the water. One day, a fax came in from North Korea. It notified Lee that the contract was null and void, as he had not supplied the raw materials or collected the water produced. “We had ten or so employees, and they all went their separate ways,” Lee sighed. “Fifteen years of work in North Korea, and all I have left now is a pile of debt.”

“North Korea said it would sell China the water produced at the facilities I invested in,” Lee added.

“Even so, they told me they would restore my rights if I am able to work again like before, so I really hope the inter-Korean trade restrictions are lifted right away so that I can do business freely.”

Read the full story here:
Losses continue for businesses engaged in inter-Korean trade
Hankyoreh
Park Byong-su
2011-6-16

According to Xinhua:

Maritime authorities in China and the Democratic People’s Republic of Korea (DPRK) on Wednesday launched their first joint patrol on the Yalu River, located on the border of the two countries.

The action, aimed at maintaining navigation order along the river, was conducted by Maritime Safety Administration of Dandong City, China’s northeastern Liaoning Province, and its counterpart in DPRK’s P’yonganbuk-do.

Three vessels from China and two vessels from the DPRK inspected about 92 km along the river and cleared ships and fishing boats hindering the normal flow of ships around the river’s Dadong Port, according to the Dandong Maritime Safety Administration.

In April this year, maritime authorities of the two countries signed a cooperative agreement on the management of the Yalu River. In the agreement, the two sides vowed to conduct joint patrols and rescue on the river.

Read the full story here:
China, DPRK launches first patrol on Yalu River
Xinhua
2011-6-15

According to the Korea Herald:

North Korea is a country that has been almost entirely isolated from news around the world for the past 60 years. The regime in Pyongyang allows Internet access to only a fraction of government officials and its power elite as it prepares for a third-generation hereditary succession to a young man in his late 20s.

The people of North Korea have been brainwashed since childhood to pay respect to the country’s idolized “Great Leader” Kim Il-sung and his son “Dear Leader” Jong-il.

So was Kim Hung-kwang until he began watching South Korean movies and drama in 1995.

“Toddlers are taught by their parents to say ‘thank you, Dear Leader’ before every meal,” Kim said in an interview with The Korea Herald.

“I had been a brainwashed, proud member of the (North Korean Workers’) party myself, until I came across South Korean films in 1995 and eventually learned that the outside world was much better.”

The computer engineering professor managed to flee the North seven years later and arrived in the South in 2003. He was joined by his family two years later.

Born in the eastern coastal city of Hamheung in 1960, Kim graduated from Kim Chaek University of Technology in Pyongyang, meaning he had been one of the North Korean regime’s highly trusted party members. While working as a professor of computer engineering at the Communist University, he was caught for lending some CDs containing South Korean drama to a friend and was sent to a collective farm as punishment.

This prompted him to defect to the South via China in 2003.

In 2008, he launched North Korea Intellectuals Solidarity with about 300 professors, engineers, doctors, journalists and writers from the North.

Now, he runs a dormitory and school for children of fellow defectors from the North, an Internet broadcasting station and publishes a periodical of articles by his colleagues.

The NK Intellectuals Solidarity is also a well-known source of breaking news from the North such as the currency denomination measure in late 2008 thanks to its informants around the China-North Korea border areas.

About 3,000 mobile phones are believed to be secretly used in the North for business purposes or delivering local information across the border, according to Kim.

“About 10 of them are ours, through which we hear about what’s going on there from our informants,” he said.

The informants in the North face the danger of getting caught by the authorities while speaking on the phone near the Tumen and Yalu Rivers with their co-workers in China.

One of Kim’s informants was caught two years ago on charges of spying and was tortured to death.

“She was a mother of three in her 30s who told us things like how the locals perceive the latest economic policies, but (the North Korean authorities) branded her as a spy,” Kim said.

“(Her death) was traumatizing and made us question if we should keep doing this. But we decided not to stop because otherwise, we wouldn’t be able to know about the inhumane crimes committed in the North.”

Kim’s solidarity has also sent in about 300 USBs technically modified to avoid detection.

The USBs do not contain any propaganda, but information on “what the defectors found surprising in the South,” dozens of new media programs such as PDF viewer, MP3 player software and e-books to enable more North Koreans to view South Korean video and text files, Kim said.

“Contrary to what we had expected, copies of Wikipedia entries turned out to be the most popular (among the North Koreans),” he said.

Currently, only five homepage servers are registered under the North Korean domain (.kr). The country connected itself to the Internet in mid-August, but only a handful of selected people are believed to have access to the Web.

Over 20,000 North Koreans have defected to the South since the Korean War ended in a truce in 1953. Hundreds are entering the South each month now mostly via China.

“I think about 4,000 people will arrive (in the South) next year,” Kim said.

“Women used to take up about 80 percent (of the defectors) before, but lately the percentage of men is going up.”

The North still maintains tight vigilance along its borders, but an increasing number of people manage to avoid the authorities’ eyes mainly thanks to bribery.

“Nowadays, it costs between 3.5 and 4 million won to bribe a single person (a soldier along the border, for example) in order to cross the border. The price goes up as (the North) tightens borderline vigilance,” Kim said.

About the North Korean people’s consciousness that they were being mistreated by the dynastical regime in Pyongyang, Kim said it was still in a “germinal stage.”

Pyongyang has tried to soothe its starving people by promising that food supply will be normalized next year, the deadline Pyongyang has set to become a “strong and prosperous nation.”

“But if the food conditions do not improve next year and turns out that it was all words and no action, people will really turn their backs against the government,” Kim said.

“They will know for sure that they are merely being used by the government. They will think that an individual’s basic rights should be placed above their government and start thinking about why there is such a major gap between what the current regime says and the reality.”

The North Koreans are now starting to learn about the need for a social safety net and how the South Korean society is going about its welfare policies through the limited information they receive from outside, Kim said.

“The third stage will be discussing what they have learned among themselves,” he said.

“Starting from groups of two or three people, the discussions will expand and eventually allow certain groups to take action.”

South Korea has reportedly been making contingency plans for various scenarios including a “sudden change” in the North such as the collapse of the Kim regime that will lead to a massive movement of refugees across the inter-Korean border.

“In case of a sudden change, the South can run a buffer zone just south of the border to temporarily house the refugees and prepare them for life in the South, although blocking the people’s free travel would be another issue,” Kim said.

“But because it would be a temporary measure, I don’t think we need to worry too much about a mass influx of refugees.’

Kim also noted that while preparing for a sudden change or unification, South Koreans should not underestimate the North.

“The South has no nuclear weapons, no inter-continental ballistic missiles, no cyber warfare troops, and most important of all, it suffers from internal conflict,” he said, mentioning an online survey last year that showed that some South Koreans did not trust their own government’s conclusion that the North torpedoed the Cheonan.

Kim said the North was training some 3,000 hackers to attack the IT systems of major South Korean institutions.

The prosecution concluded last month that North Korea was behind the cyber attack that paralyzed the banking system of the National Agricultural Cooperative Federation, or Nonghyup, in April.

“Our website was attacked in the same way they attacked Nonghyup,” Kim said.

“The North is very good at stirring up social conflict in the South, prompting certain pro-North groups to call on the government to ‘appease the North,’ or send money to Pyongyang. Their aim is to set up a pro-North regime in the South,” Kim said.

As for the “pro-North people” in the South, Kim said they seemed to hold an illusion that the North Korean system might settle their personal grudges or social problems in the South despite the fact that the Kim regime’s ideology has failed in reality.

Kim called on the South Korean government to set up a clear set of rules and conditions regarding the extent of humanitarian aid the South can send to the North in cases of natural disasters, for example, so that emergency aid to the North becomes more transparent.

Read the full story here:
N. Koreans use phones to sneak information out
Korea Herald
Kim So-hyun
2011-6-15

Pictured Above: (Left) Map of the reclamation project shown on North Korean television and (right) the project mapped out on Google Earth.  View in Google Maps here.

On June 7, 2011, North Korean Central Television announced the resumption of the Sohae-ri – Nunggum Island land reclamation project (서해리-능금도 간석) in Unryul County (은률군). I have posted the relevant television footage to YouTube.  You can watch it here.

According to my calculations on Google Earth, the project will reclaim just over 11 km² from the West Sea.  As with other projects, the new real estate will probably be used for food production: agriculture, salt farms, and sea food farms.

The DPRK has launched many projects like this to boost domestic food production (see here, here, and here).  Since the country is overwhelmingly mountainous, and insists on maintaining a closed system, it has limited capacities to obtain the required amount of food needed to sustain the population.

Available options include exports, aid, “decentralized coping techniques”, and land reclamation.  The DPRK has shown no interest in boosting exports to finance food imports, even during the Arduous March. Food aid is only a temporary solution, not a long-term strategy for achieving food self sufficiency.  Additionally, food aid comes with all those pesky monitors and their foreign influences. Decentralized coping mechanisms empower local officials, private growers, and markets at the expense of the national government’s Public Distribution System (PDS) and national forests (cleared for illegal plots).

“Land reclamation” (or through the transformation of inland acreage through irrigation projects) does not seem to scare the North Korean government as much.  Some sea-side villages may become inland villages, but increases in official food production can be channeled through the PDS to strengthen the DPRK government’s grip over its people vis-a-vis the distribution of food (once again).

According to KCNA, this particular section of the Unryul land reclamation project began in August 2010:

The Unryul Mine located in the western area of Korea has benefited from its large-sized and long-distance belt conveyor.

The open-pit mine supplying the Hwanghae Iron and Steel Complex with iron ore was once harassed by myriads of earth-scraping piled up on iron ore seams.

Acquainting himself with the problem, leader Kim Jong Il unfolded a bold and large-scale plan to remove earth-scraping with a belt conveyor.

Under his wise guidance the belt conveyor stretched about 4,600 meters from Lagoon Kumsan to Nunggum Islet in Juche 64 (1975) as the first stage of the project.

Over the past 35 years it has carried 40 million tons of earth to the sea, linking the mainland with islets.

It has also saved much manpower, materials and equipment which had been needed for earth removal.

The earth transported by the belt conveyor was used to build a ten-odd-km-long dike from Lagoon Kumsan to Wolsa-ri, Kwail County via Nunggum, Ung and Chongryang Islets and reclaim more than 3 500 hectares of tideland for agricultural production.

Now the belt conveyor has changed its direction toward Jui Islet from Nunggum Islet.

The dike has more than 1.3 million trees of several dozen species growing in over 150 hectares. A ring road was also built on it.

Many animals and birds such as pheasant, roe deer, hare, raccoon dog and cuckoo live there.

Institute for Far Eastern Studies (IFES)
NK Brief 2011-6-13

Kim Jong Il has made four official appearances from May 28 to June 3 since his last visit to China, starting with industrial facility inspections. This could be construed as North Korea’s attempt to highlight current facility-building projects and the superiority of its leadership in improving the people’s economy, and to rally the North Korean people.

Kim commemorated his recent unofficial visit to China by attending a celebratory performance. In a speech, he commented on the outcome of the visit and encouraged solidarity and morale building of its people.

On his return from China, Kim provided field guidance at the construction site of Huichon Power Plant. He called for the early completion of the plant as an essential step in resolving North Korea’s chronic power shortage. Specifically, Kim commented, “Resolving the power shortage is the major task in order to build a strong and prosperous nation . . . . appropriate units must ensure timely production of facilities, equipments and materials.” Kim is reported to have visited the construction site of Huichon on five occasions from September 2009 to December of last year.

In addition, Kim visited a fish breeding institute and Kosan Fruit Farm, encouraging the pursuit of technology development projects through modernization and scientific advancement.

At the fish breeding institute, Kim called for the improvement of the ecological environment of the fishery and for the increase in fish production by constructing more fish farms and by advancing the facility in a way that meets the demands of industrialization and modernization.

Similarly at the Kosan Fruit Farm (located in the Gangwon Province), production was stressed once again as an important task. Kim called for the improvement in fruit production through modernization and the integration of science and technology. This was Kim’s third visit to the farm since 2008.

Kim’s official visits this year are slightly fewer in number compared with the same period of time last year: from 70 visits in 2010 (19 military-related, 29 economic-related, 6 foreign-related, 13 other activities), to 60 visits in 2011 (13 military-related, 28 economic-related, 6 foreign-related, 13 other activities) in 2011.

All major DPRK news outlets covered Kim’s recent visit to China. The Politburo of the Workers’ Party of Korea Central Committee organized a meeting calling for the strengthening of DPRK-China relations. Likewise, the Presidium of the Supreme People’s Assembly praised the current DPRK-China economic cooperation activities and growing friendship between the two nations.

Pictured above: A member of the DPRK TKD team trains a middle school student in Boston, MA.  See other photos here.

According to Yonhap:

A group of North Korean taekwondo athletes arrived in the United States Thursday (June 9) for a rare performance tour abroad amid hopes of a thaw in Pyongyang-Washington relations as the U.S. appears to be preparing for the resumption of food aid.

The 17-member team, which left Pyongyang on Saturday, arrived in San Francisco at 10:40 a.m. by way of Beijing.

This will be the second time the group has toured the US (The first time in 2007).  The web page for both tours (2007 and 2011) is here.  It appears the last performance is tonight in Delaware Valley.

A documentary on the 2007 tour will be released soon (web page here and trailer here). According to PRWeb:

This June, the North Korean National Taekwon-Do Demonstration Team perform for American audiences on the east coast. This cultural exchange follows their historic 2007 Taekwon-Do Goodwill Tour sponsored by Iowa resident, Woo-Jin Jung, which is being made into a documentary film called “Tong-il: Breaking Boards, Bricks, and Borders” by Texas filmmaker, Luan Van Le, and independent production company, LUV Films.

From June 11 through June 14, 2011, a 17-member North Korean Taekwon-Do delegation will travel and perform in Boston, MA, New York City, and New Jersey, for their 2011 TKD Goodwill Tour. Spearheaded by Grandmaster Woo-Jin Jung, a US citizen, it is a cultural exchange to promote peace between North Korea and the USA. Filmmaker, Luan Van Le, has been following Jung’s efforts for the feature documentary called “Tong-il” which covers Jung’s biography as well as the first 2007 North Korea/USA TKD Goodwill Tour.

The Korean War ended in 1953 with an armistice backed by the USA on the South Korean side and the Soviet Union on the North Korean side, leaving the peninsula divided to present day. The absence of a peace treaty leaves all parties in a technical state of war and hostilities. Through 2010, the diplomatic relationship between the USA, South Korea, and North Korea dove to an all time low and hinges on North Korea’s feared nuclear weapons program. Since the relationship between the USA and North Korea are vital to any eventual peace and reunification of the Korean peninsula, the TKD

Goodwill Tours are efforts to help jumpstart diplomatic endeavors through non-governmental people-to-people exchanges. The practice of Taekwon-Do espouses building a more peaceful world and Grandmaster Jung strives to exemplify the philosophies taught through this Korean martial art.

Luan Van Le was given permission by the North Korean government to travel and film in North Korea in June of 2007 and was given exclusive access to film the North Korean delegation through the October 2007 TKD Goodwill Tour, which traveled to Los Angeles, San Francisco, Cedar Rapids, IA, Louisville, KY, and Atlanta, GA, over two weeks. The 2011 tour is meant to introduce the North Koreans to new cities and audiences. LUV Films, the company responsible for the production of “Tong-il,” will be on-hand to record the New York segment. The documentary “Tong-il” is currently in the editing and post-production phase and is set to be finished this summer.

To learn more about the documentary go to http://www.tong-ilmovie.com and to attend the June event visit http://www.usnktkd.com.

You can learn more about the bizarre history of Taekwondo and North Korea here.

According to the New York Times:

The United States Navy intercepted a North Korean ship it suspected of carrying missile technology to Myanmar two weeks ago and, after a standoff at sea and several days of diplomatic pressure from Washington and Asia nations, forced the vessel to return home, according to several senior American officials.

Washington made no announcement about the operation, which paralleled a similar, far more public confrontation with North Korea two years ago. But in response to questions about what appears to be a growing trade in missiles and missile parts between North Korea and Myanmar — two of the world’s most isolated governments — American officials have described the episode as an example of how they can use a combination of naval power and diplomatic pressure to enforce United Nations sanctions imposed after the North’s last nuclear test, in 2009.

It was a rare victory: a similar shipment of suspected missile parts made it to Myanmar last year before American officials could act. Despite the Obama administration’s efforts to squeeze North Korea with both economic and trade sanctions, there are continuing reports of sophisticated missile technology exchanges, some of it by air, between North Korea and Iran, among other nations.

North Korea, aware that shipments leaving the country are under increased scrutiny, has found a profitable trading partner in the authoritarian government in Myanmar.

The extent of that trade is unclear to American intelligence agencies. Two years ago, Secretary of State Hillary Rodham Clinton publicly expressed suspicions that Myanmar was attempting to purchase nuclear weapons technology, but it recently said it was too poor to use such technology. And the evidence has been scant at best. (In 2009, India inspected a North Korean ship that was believed to be carrying equipment for a nuclear reactor to Myanmar, but quickly discovered that its contents were legal.)

The most recent episode began after American officials tracked a North Korean cargo ship, the M/V Light, that was believed to have been involved in previous illegal shipments. Suspecting that it was carrying missile components, they dispatched a Navy vessel, the destroyer McCampbell, to track it.

“This case had an interesting wrinkle: the ship was North Korean, but it was flagged in Belize,” one American official said, meaning it was registered in that Central American nation, perhaps to throw off investigators.

But Belize is a member of the Proliferation Security Initiative, an effort begun by President George W. Bush’s administration to sign up countries around the world to interdict suspected unconventional weapons. It is an effort that, like the military and C.I.A. drone programs, Mr. Obama has adopted, and one of the rare areas where he has praised his predecessor.

According to American officials, the authorities in Belize gave permission to the United States to inspect the ship.

On May 26, somewhere south of Shanghai, the McCampbell caught up with the cargo ship and hailed it, asking to board the vessel under the authority given by Belize. Four times, the North Koreans refused.

As in the 2009 case, which involved the North Korean vessel the Kong Nam 1, the White House was unwilling to forcibly board the ship in international waters, fearing a possible firefight and, in the words of one official, a spark “that could ignite the Korean peninsula.” Moreover, the Americans did not have definitive proof of what was in the containers — and a mistake would have been embarrassing.

“There is always a chance that the North is setting us up for a raid that they know will find nothing,” one official said. “So we want to make sure we don’t fall into a trap.”

By happenstance, a group of senior officials from the Association of Southeast Asian Nations — including a representative from Myanmar — was in Washington while the slow-speed chase was occurring 8,000 miles away. On May 27, when the group visited the Old Executive Office Building opposite the White House, Gary Samore, the president’s top nuclear adviser, addressed the officials, urging Vietnam, Thailand, Indonesia and Malaysia to fully join the nonproliferation effort.

He then surprised the Asian officials by telling them he had a “sensitive subject” to raise, and described the American suspicions, providing the group with a picture of the ship on its way to Myanmar. He reminded them that under United Nations Security Council Resolution 1874, which was passed in response to the North Korean nuclear test in 2009, its vessels are to be inspected if “reasonable grounds” exist to suspect that weapons are being exported.

“The Burmese official in the room protested that we were making accusations,” said one American official familiar with the exchange. Myanmar, formerly known as Burma, has denied stockpiling missiles or buying parts from North Korea. It repeated those denials during recent visits to the country by a midlevel State Department official and by Senator John McCain.

American officials dismiss those denials, pointing to years of evidence of missile-related purchases during both the Bush and Obama administrations. But they concede they are mystified about Myanmar’s motives. The missiles that they believed were aboard the M/V Light have a range of about 350 miles, meaning they could hit parts of India, China, Thailand or Laos — all unlikely targets.

The message apparently got across. A few days later, long before approaching Myanmar, the cargo ship stopped dead in the water. Then it turned back to its home port, tracked by American surveillance planes and satellites, and suffering engine trouble along the way.

And according to the Wall Street Journal:

Under pressure from the U.S. and other countries, a North Korean vessel called the M/V Light turned around in the South China Sea two weeks ago and returned to the North last week, U.S. and South Korean officials said Monday.

Among the countries that agreed to apply pressure was Myanmar, a previous destination for North Korean weapons, a senior U.S. official said. Some reports said the North Korean ship was bound for Myanmar, but the U.S. official, Gary Samore, special assistant to President Barack Obama on weapons of mass destruction, said its final destination wasn’t clear.

“It was headed for the Straits of Malacca, which would have required it to pass between Malaysia and Singapore,” Mr. Samore said. “Since we had alerted the Singaporean and Malaysian authorities, there might have been concern [in Pyongyang] whether it could pass through the straits without action by either of those countries.”

The ship turned around, without the U.S. resorting to force, before reaching the straits.

North Korea’s state media haven’t reported on the latest journey of the M/V Light, keeping with a silence it maintained over previous interceptions of its weapons-ferrying ships and planes.

The incident is unlikely to change the fundamental standoff between North Korea and other nations over its nuclear-weapons program. The U.S., China and other countries have tried to lure North Korea back to the so-called six-party talks, in which Pyongyang has been encouraged to give up its nuclear pursuit in exchange for economic incentives and security guarantees.

Mr. Samore said the multilateral cooperation is a signal to North Korea that other nations remain committed to enforcing the trade limitations set forth by the U.N. Security Council several weeks after Pyongyang tested a nuclear weapon in 2009.

…

U.S. officials in late May began tracking the M/V Light, and a U.S. Navy destroyer intercepted it on May 26 and followed it down the Chinese coast for several days. Meanwhile, American diplomats won agreement from several southeast Asian nations to stop the ship if it attempted to make port.

U.S. officials also discussed the M/V Light with North Korean officials several times via the North’s U.N. delegation, a so-called back channel the two countries use because they don’t maintain official diplomatic relations.

“The North Koreans claimed the ship was going to Bangladesh with a cargo of industrial chemicals,” Mr. Samore said. “We have no way to verify whether any of that was true. And we had good reason to be suspicious with this ship, which in the past has been involved in the export of weapons to [Myanmar] and other locations in the Middle East.”

Read the full stories here:
U.S. Said to Turn Back North Korea Missile Shipment
New York Times
David Sanger
2011-6-12

North Korea Keeps Silent on Ship’s Turnaround
Wall Street Journal
Evan Ramstad
2011-6-14

According to the Daily NK:

The North Korean authorities are reportedly reacting more strictly than normal to overt sales of products from South Korea in the country’s domestic markets.

One Korean-Chinese man engaged in business in Pyongan and Hwanghae Provinces told The Daily NK on June 11th, “They’re cracking down hard on products from the Kaesong Industrial Complex in the jangmadang, and are reacting more strongly than before to South Korean products, too. There are no South Korean goods on sale openly.”

Sources say that in many cases this means that traders are being told to remove tags indicating South Korean origin.

The same trader explained, “Community watch guards come to the jangmadang and tell us to remove tags written in Chosun then sell them. They are thoroughly cracking down on things saying ‘Made in Korea’. Even though the clothes are of good quality, and therefore clearly South Korean, if there is no tag, then they are not prohibited.”

Currently, used clothes are said to be selling better than new ones, however. This is partly because people have little cash and are gravitating towards the cheaper prices, and partly because they don’t trust new products.

The trader explained, “The image of South Korean clothes is good as far as used clothes selling better than new ones goes. People think that new clothes are of poor quality and really expensive.”

He explained the reason for the low quality, saying, “Currently, producers are buying fabric in China to bring back and manufacture clothes in Chosun, and then they put ‘Made in China’ tags on them.”

A woman’s short-sleeve t-shirt is now worth 5,000 won for a new one but just 1,500 won for a used one. Since the price difference is huge and new ones are of questionable quality, decent used ones sell better.

Another source from Changbai in China corroborated the story, explaining, “Everybody from North Korea asks us to send them used stuff to sell. We go to Guangzhou to buy used clothes smuggled in from South Korea, and send them to North Korea. The demand from North Korea for South Korean used clothes is pretty high.”

Meanwhile, due to mobilization for seasonal agricultural work, the North Korean markets are currently operating from 5 PM to 7PM. They normally open at 2 PM.

However, the Korean-Chinese trader explained that despite the afternoon market closures, farms are facing an uphill battle, saying, “Since anyone who wants to survive has to trade, the number of traders has doubled. And since almost everyone is trading and their focus is on that, there is no way the farming work can go well.”

Read the full story here:
“Remove Tags, then Sell Them”
Daily NK
Park Jun Hyeong
2011-6-13